Under Absorption Costing, a Company Had the Following Unit Costs

question 32

Multiple Choice

Under absorption costing, a company had the following unit costs when 9,000 units were produced. Compute the total product cost per unit under variable costing if 30,000 units had been produced.

• A) $31.75
• B) $28.25
• C) $23.45
• D) $15.25
• E) $20.75

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Definitions:

Mirror-Image Rule

A principle which holds that the terms of an acceptance must mirror the terms of the offer. If the terms of the acceptance do not mirror the terms of the offer, no contract is formed and the attempted acceptance is a counteroffer.

Acceptance

In contract law, it is the expression of assent to the terms of an offer in such manner as requested or authorized by the offeror.

Terms

Stipulations or conditions specified in a contract or agreement.

Common Law

A body of unwritten laws based on legal precedents established by the courts, influencing the decision-making in novel cases.